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Pakistan receives $499m IMF tranche

The IMF acknowledged Pakistan’s robust economic performance. Source: FILE.

ISLAMABAD: The State Bank of Pakistan (SBP) has confirmed receiving $499 million loan from the International Monetary Fund (IMF).

In a statement, the central state confirmed having received IMF tranche of US$ 498.7 million (equivalent to SDR 350 million) under the Extended Fund Facility.

The IMF’s executive board approved second to fifth review under the Extended Fund last week. After the release, Pakistan has received around a total of $2 billion from the global financial institution under the EFF facility.

The decision came after the IMF executive board completed delayed reviews of Pakistan’s $6 billion loan program. The global financial institution said the latest payment brought total disbursements under the Extended Fund Facility to $2 billion since the program was approved in July 2019.

“The Pakistani authorities have continued to make satisfactory progress under the fund-supported program, which has been an important policy anchor during an unprecedented period,” IMF Deputy Managing Director Antoinette Sayeh has said in a statement.

“While the COVID-19 pandemic continues to pose challenges, the authorities’ policies have been critical in supporting the economy and saving lives and livelihoods,” she said.

The disbursement was made after Pakistan cleared up an issue with data on government guarantees dating to fiscal 2016 that had been reported inaccurately and put the government in noncompliance with the program.

The IMF said Pakistani authorities had taken strong corrective actions to address institutional shortcomings, including a lack of interagency coordination, to correct the issue.

In April, the IMF had postponed a board meeting for the approval of the second review after Islamabad failed to announce a mini-budget for readjusting the economy.

In February, both sides agreed to club the pending second, third, fourth and fifth reviews of the programme. The separate completion of these reviews would have led to disbursements of $2.2bn, which the IMF has now reduced to just $500m.

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